Net Lease REIT Strikes $67.9M Deal for Restaurant Portfolio

MILL VALLEY, CA—Restaurant net lease REIT Four Corners Property Trust has signed a definitive agreement to buy 23 outparcel properties that have 26 leases from Seritage Growth Properties for $67.9 million.

The portfolio includes 21 single tenant restaurant properties and 2 restaurant-anchored, multi-tenant properties. The transaction is expected to close in various tranches throughout 2019 and 2020, subject to customary closing conditions and regulatory approvals.

The 23 outparcels span 18 restaurant brands including 8 which are new to FCPT’s portfolio. The restaurant brands include Bahama Breeze, BJ’s Restaurant, Carrabba’s, Chick-fil-A (3), Chili’s, Corelife Eatery (new), Hook & Reel (new), Hopdoddy Burger Bar (new), Krispy Kreme (new), LongHorn Steakhouse (3), Olive Garden, Outback Steakhouse (2), Pollo Tropical (new), Popeye’s, Portillo’s (new), Shake Shack (new), Smokey Bones (new), and Wendy’s (2).

The portfolio also includes 2 non-restaurant brands, Jared Jewelry and Orvis, which are inline tenants in a multi-tenant building.

The retail outparcels are located in Delaware, Florida, Illinois, Indiana, Michigan, Missouri, New Jersey, Ohio, Rhode Island, South Carolina, Tennessee, Texas, and Virginia.

Of the 26 leases, 22 are with the brand’s corporate entities. Each property has a separate individual lease and the leases have a current weighted average remaining term of 8 years. Additionally, 15 of the 23 properties are recently constructed as part of Seritage’s redevelopment strategy, which is less than 3 years since opening.

This is the third outparcel portfolio deal FCPT has announced in the past three months, according to CEO Bill Lenehan. The three portfolios total $153 million across 67 properties.